What the draft European Union AI regulations mean for business

As artificial intelligence (AI) becomes increasingly embedded in the fabric of business and our everyday lives, both corporations and consumer-advocacy groups have lobbied for clearer rules to ensure that it is used fairly. In May, the European Union became the first governmental body in the world to issue a comprehensive response in the form of draft regulations aimed specifically at the development and use of AI. The proposed regulations would apply to any AI system used or providing outputs within the European Union, signaling implications for organizations around the world. Our research shows that many organizations still have a lot of work to do to prepare themselves for this regulation and address the risks associated with AI more broadly. In 2020, only 48 percent of organizations reported that they recognized regulatory-compliance risks, and even fewer (38 percent) reported actively working to address them.